Use-tax measure 'not a double tax,' Jackson mayor says

A use tax would be “Small for You, But Big for Jackson,” said Jackson Mayor Dwain Hahs at the Cape Girardeau Area Chamber of Commerce’s First Friday Coffee event.

“That’s really what this means to us as we go forward,” Hahs said, noting on $500 of online, out-of-state purchases, about $12.50 would be collected with the use tax.

That isn’t much, Hahs said, but, by the city’s estimates, it could mean as much as $600,000 to $750,000 annually in revenue for the city.

About 65 percent of the city’s revenue comes from sales tax, Hahs said, and sales tax is running flat, thanks to spending patterns shifting to more online purchases.

“That presents a challenge for the city, as we want to fund new projects as we move forward and our population grows,” Hahs said.

The use tax is not a double tax, Hahs said.

The use tax applies only to goods that come in from out of the state, Hahs said.

“If you already pay sales tax on a purchase, you do not pay the use tax,” Hahs said — if a purchase wouldn’t incur a use tax at the county or state level, it wouldn’t at the city level, either.

The use tax rate would be the same as the city’s sales tax rate, Hahs added: 2.5 percent, one of the lowest in the region.

“We’d like to capitalize on the ability to tax at the same as our local rate on goods coming from outside Missouri,” Hahs said.

Charlie Glueck, owner of Jackson Tire and Jackson Fast Lube Services in Jackson, said the community’s expectations of business owners are high, and rightfully so, but the playing field is changing.

“In today’s world, we have a fierce new competitor,” Glueck said: online shopping and buying.

And, he said, as younger people’s buying strength continues to grow, “I assure you, this issue is not going to go away.”

That will impact public safety, Glueck said, as sales tax revenue funds the police and fire departments, and street repairs.

“I believe everyone is affected who uses the services in Jackson and the surrounding areas,” Hahs said.

As to what the revenue would fund, Hahs said a 2017 community survey identified three key points respondents thought were priorities.

“The first was public safety,” Hahs said, noting the city has added police officers and school resource officers, and will break ground next week on a new police station.

The second priority identified was traffic flow and streets, Hahs said, and intersection and road improvements have been made since.

Other priorities were also established, Hahs said — projects city leaders would like to address, but haven’t had the funding to do so.

Streetlights to illuminate East Jackson Boulevard between Interstate 55’s exit 99 and Walmart, Hahs said, would finally be added with funding from use-tax revenue.

And, Hahs said, curbside recycling is a service Jackson leaders would like to offer, but startup costs are prohibitive: new trucks, bins and workers are a significant expenditure.

The use tax revenue would help fund that and allow for customers to opt in to the service, Hahs said.

The 40-year-old municipal swimming pool has challenges of its own as well, Hahs said.

“Strategically, we’ve had it on our list of priorities for a long time,” Hahs said of the pool.

Hahs said over time, Jackson city leaders would look at other priorities, but these three are the first targeted projects.

The use tax ballot measure will be on the April 2 municipal ballot in Jackson.

mniederkorn@semissourian.com

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